Two Wheeler Sales Analysis for July 2016; TVS outperforms Bajaj Auto

NEW DELHI: Indian two-wheeler industry has seen strong revival in the last few months on the back of expectation of better than normal monsoons and positive market sentiment. While experts suggest that the rural demand which was on an abeyance for a year has returned.

"if you see last year, there was almost no demand but this year those who have postponed their buying decisions are buying now. As consumer is much more confident in terms cash flow" said Abdul Majeed, Partner, PWC

Most of the two-wheeler manufacturers have reported strong double-digit growth except the top manufacturer Hero MotoCorp. The cult bike maker Royal Enfield had the highest 31 percent growth in July compared to the same month a year ago. The Eicher Motors-owned two-wheeler brand sold 52,128 units in July 2016 compared to 39,867 units same month last year.

As per industry pundits, Royal Enfield has managed to position its product at right spot. For instance, Royal Enfield, immaculately filled the void between 250-350 cc with Bullet Electra and Classic 350 which is one of the fastest growing segment in the country.

Apart from Royal Enfield, the TVS motors have been growing at a steady rate. In the month of July, the Chennai-based motorcycle manufacturer has surpassed country's oldest two wheeler manufacturer Bajaj Auto for the second consecutive month. Bajaj Auto is currently facing a tough time in the export market too.

Despite the strong growth rate of 20 percent Bajaj Auto stands behind TVS which managed to grow at at a rate of 19 percent. TVS sold 2,06,605 units in the month of July compared to 1,98,022 units of Bajaj, however, it is note that TVS has moped which gives an additional volume.

Japanese two-wheeler manufacturer Honda continues to post robust growth of 16 percent from 371,310 units in July 2015 to 429,527 units in July 2016. The sales of the two-wheeler maker is led by Activa contributing 19 percent of total Honda's total automatic scooter sales stood at 309144 units.

On another hand, the home-grown two-wheeler manufacturer , Hero MotoCorp recorded 9 percent of growth. The company recently commenced retail sales of Splendor iSmart 110 the first motorcycle to have been completely designed and developed by its in-house R&D team at the Hero Centre of Innovation and Technology in Jaipur.

On the outlook, Hero MotoCorp said, "With the above average monsoon and implementation of the 7th pay commission recommendations, the company remains cautiously optimistic about a positive turnaround in the industry in the second half of the year."

Lastly, Yamaha which has been dodging between different segment recorded a growth rate of 12 percent at 65,244 in July 2016 compared to 58,477 in the same last year.

The company continues to maintain an upward trend in sales at the back of its product line-up with the addition of the newly-launched disc brake variant of the Cygnus Alpha scooter and the new Cygnus Ray-ZR. Yamaha is increasing focus on expanding to tier II and III cities, thus reaching out to larger groups of the target population has also been the main reason behind boosting sales.